Spain’s police arrested six individuals behind a large-scale cryptocurrency investment scam that used AI tools to generate deepfake ads featuring popular public figures to lure people.
The scam was very successful, defrauding 19 million Euros ($20.9M) from 208 victims worldwide.
The police operation, codenamed “COINBLACK – WENDMINE,” started two years ago following the submission of a victim’s complaint. The action led to the arrests of six individuals aged between 34 and 57 in the regions of Granada and Alicante.
Moreover, 100,000 Euros, mobile phones, computers, hard drives, firearms, and documents were seized during the police raids.
The police’s announcement underlines the complexity of the operation, explaining that the criminals had created multiple shell companies to launder the crime proceeds. At the same time, the group’s leader used over 50 distinct aliases.
Multiple scam phases
The scam had multiple phases, starting with typical “romance baiting” or the threat actors posing as “financial advisors” and ending with a twist of fake money recovery claims.
Victims were chosen via algorithms that selected persons whose profiles matched the cybercriminal’s targeting requirements and subsequently targeted by AI-generated deepfake ads.
“With the help of Artificial Intelligence, the scammers created fake ads featuring well-known national figures apparently recommending investing in these products,” explains the Policia National announcement.
“This significantly increased the victims’ trust in the security and profitability of the investments.”
Victims initially saw large investment returns on what were essentially fake platforms that generated false figures.
At some point, the scammers, who posed as financial advisors or even simulated romantic relationships with the victims, informed them that their investments had been blocked and their money could only be recovered if they made a large payment.
In the final phase, the victims were contacted by the scammers again, who now posed as Europol agents or UK lawyers, claiming that their funds had been recovered and only required them to cover local tax costs to get them back.
The police warn the public to be wary of promises of guaranteed returns and always verify the legitimacy and trustworthiness of an investment platform before depositing any funds.
Other red flags include pressure to invest, inability to withdraw, unexpected balance “blocks,” and claims about additional “fees/taxes” required to withdraw money.
Realistic AI-generated deepfake videos are now easy to create, so users should not be influenced by famous people supposedly promoting investment platforms.
